Proposed Changes to Producer Payment Protection

WINNIPEG, Oct. 7, 2013 /CNW/ - On October 5, 2013, changes to the
Canadian Grain Commission's producer payment protection model and
regulations were published in the Canada Gazette, Part I and are available online at www.gazette.gc.ca.

All stakeholders, including licensees, farmers, farm groups and industry
associations, are invited to submit their feedback on the amended
regulations until November 4, 2013.

These changes are a result of amendments made to the Canada Grain Act as part of the Jobs and Growth Act, 2012. They propose to implement an insurance-based security model for
producer payment protection. This model is expected to reduce the
overall cost of producer payment protection coverage to the grain
industry.

The objectives of the proposed regulations are to:

Reduce costs to the grain industry and the Canadian Grain Commission;

Reduce administrative burden to licensees and the Canadian Grain
Commission;

Establish that an eligible holder of an authorized document must be a
producer. This removes a requirement with respect to terminal elevators
to tender security, which is not applicable to them because terminal
elevator operations do not incur producer liabilities;

Apply consistent periods for payment and delivery obligations for all
authorized document holders;

Encourage producers to take steps to minimize the risk of not being paid
by adding a 5% deductible and reforming their eligibility period to 45
days from the date of delivery; and

Create a more predictable and transparent producer payment protection
model.

Under the proposed new model, producers would continue to be protected
against non-payment for their eligible grain deliveries. Coverage will
continue under the current individual security-based payment protection
model until the new proposed model takes effect.

About the Canadian Grain Commission

The Canadian Grain Commission is the federal agency responsible for
establishing and maintaining Canada's grain quality standards. Its
programs result in shipments of grain that consistently meet
specifications for quality, safety and quantity. The Canadian Grain
Commission regulates the grain industry to protect producers' rights
and ensure the integrity of grain transactions.